14 Outperforming Small Caps Undervalued By EPS Trends

Do you prefer to invest with a stock's momentum trends? For a closer look at stocks currently outperforming the market, we ran a screen. We began by screening the small-cap sector for stocks that have outperformed the market over the last quarter, with over 20% quarterly return.

We then screened for those that may still be undervalued, by comparing price trends to changes in EPS estimates over the last month. Based on the assumption that P/E is equal to a constant k, increases in EPS should be matched by increases in price. When they don't match up, a mispricing may have occurred. We screened for stocks with faster growth in EPS estimates than price over the last month, which may indicate that these names are being undervalued.

Click to enlarge.

Do you think these stocks will continue to outperform? Use this list as a starting point for your own analysis.

List sorted by increase in EPS over the last 30 days.

1. Veeco Instruments Inc. (NASDAQ:VECO): Designs, manufactures, and markets equipment to make high brightness light emitting diodes, solar panels, hard-disk drives, and other devices. Market cap at $1.31B, most recent closing price at $33.59. Performance over the last quarter at 20.25%. The EPS estimate for the company's current year increased from 1.1 to 1.52 over the last 30 days, an increase of 38.18%. This increase came during a time when the stock price changed by 24.92% (from 26.89 to 33.59 over the last 30 days).

2. Ellie Mae, Inc. Common Stock (NYSE:ELLI): And its subsidiaries host electronic mortgage origination network in the United States. Market cap at $325.73M, most recent closing price at $15.08. Performance over the last quarter at 108.65%. The EPS estimate for the company's current year increased from 0.32 to 0.44 over the last 30 days, an increase of 37.5%. This increase came during a time when the stock price changed by 25.56% (from 12.01 to 15.08 over the last 30 days).

3. Newcastle Investment Corp. (NYSE:NCT): Operates as a real estate investment and finance company that invests in and manages a portfolio consisting primarily of real estate securities. Market cap at $400.65M, most recent closing price at $6.46. Performance over the last quarter at 24.22%. The EPS estimate for the company's current year increased from 1.34 to 1.65 over the last 30 days, an increase of 23.13%. This increase came during a time when the stock price changed by -5.% (from 6.8 to 6.46 over the last 30 days).

4. Delek US Holdings Inc. (NYSE:DK): Engages in refining, wholesaling, and marketing petroleum products in the United States. Market cap at $926.54M, most recent closing price at $15.92. Performance over the last quarter at 22.21%. The EPS estimate for the company's current year increased from 2.51 to 3 over the last 30 days, an increase of 19.52%. This increase came during a time when the stock price changed by 0.44% (from 15.85 to 15.92 over the last 30 days).

5. Liquidity Services, Inc. (NASDAQ:LQDT): Operates an online auction marketplace for wholesale, surplus, and salvage assets primarily in the U. Market cap at $1.83B, most recent closing price at $58.76. Performance over the last quarter at 40.42%. The EPS estimate for the company's current year increased from 1.41 to 1.68 over the last 30 days, an increase of 19.15%. This increase came during a time when the stock price changed by 14.12% (from 51.49 to 58.76 over the last 30 days).

6. Pilgrim's Corp. (NASDAQ:PPC): Produces, processes, markets, and distributes fresh and frozen chicken products to retailers, distributors, and foodservice operators primarily in the United States. Market cap at $536.19M, most recent closing price at $7.24. Performance over the last quarter at 30.76%. The EPS estimate for the company's current year increased from 0.65 to 0.77 over the last 30 days, an increase of 18.46%. This increase came during a time when the stock price changed by 8.87% (from 6.65 to 7.24 over the last 30 days).

7. Myers Industries Inc. (NYSE:MYE): Distributes polymer products for the industrial, agricultural, automotive, commercial, and consumer markets primarily in the North, Central, and South America. Market cap at $544.87M, most recent closing price at $16.26. Performance over the last quarter at 20.06%. The EPS estimate for the company's current year increased from 0.81 to 0.92 over the last 30 days, an increase of 13.58%. This increase came during a time when the stock price changed by -3.56% (from 16.86 to 16.26 over the last 30 days).

8. American Vanguard Corp. (NYSE:AVD): Engages in the manufacture, development, and marketing of specialty chemical products for agricultural and commercial uses in the United States and internationally. Market cap at $662.59M, most recent closing price at $23.80. Performance over the last quarter at 45.60%. The EPS estimate for the company's current year increased from 0.94 to 1.06 over the last 30 days, an increase of 12.77%. This increase came during a time when the stock price changed by -0.96% (from 24.03 to 23.8 over the last 30 days).

9. Monster Worldwide, Inc. (NYSE:MWW): Provides online employment solutions worldwide. Market cap at $1.02B, most recent closing price at $8.45. Performance over the last quarter at 28.47%. The EPS estimate for the company's current year increased from 0.27 to 0.3 over the last 30 days, an increase of 11.11%. This increase came during a time when the stock price changed by 4.19% (from 8.11 to 8.45 over the last 30 days).

10. Allot Communications Ltd. (NASDAQ:ALLT): Engages in developing, selling, and marketing Internet protocol service optimization solutions in Europe, the Middle East, Africa, the Americas, Asia, and Oceania. Market cap at $682.78M, most recent closing price at $21.87. Performance over the last quarter at 27.64%. The EPS estimate for the company's current year increased from 0.55 to 0.61 over the last 30 days, an increase of 10.91%. This increase came during a time when the stock price changed by -6.74% (from 23.45 to 21.87 over the last 30 days).

11. SciClone Pharmaceuticals, Inc. (NASDAQ:SCLN): Engages in the development and commercialization of novel therapeutics for the treatment of oncology, infectious diseases, cardiovascular, urological, respiratory, and central nervous system disorders in the People's Republic of China and internationally. Market cap at $329.44M, most recent closing price at $5.80. Performance over the last quarter at 24.37%. The EPS estimate for the company's current year increased from 0.71 to 0.78 over the last 30 days, an increase of 9.86%. This increase came during a time when the stock price changed by -9.38% (from 6.4 to 5.8 over the last 30 days).

12. On Assignment Inc. (NYSE:ASGN): Provides flexible and permanent staffing solutions in the United States, Europe, Canada, Australia, New Zealand, and Bermuda. Market cap at $612.83M, most recent closing price at $16.29. Performance over the last quarter at 22.66%. The EPS estimate for the company's current year increased from 0.87 to 0.95 over the last 30 days, an increase of 9.2%. This increase came during a time when the stock price changed by -2.51% (from 16.71 to 16.29 over the last 30 days).

13. CoStar Group Inc. (NASDAQ:CSGP): Provides information/marketing services to the commercial real estate industry in the United States, the United Kingdom, and France. Market cap at $1.79B, most recent closing price at $69.17. Performance over the last quarter at 20.07%. The EPS estimate for the company's current year increased from 1.35 to 1.46 over the last 30 days, an increase of 8.15%. This increase came during a time when the stock price changed by -2.03% (from 70.6 to 69.17 over the last 30 days).

14. Stratasys Inc. (NASDAQ:SSYS): Engages in the development, manufacture, and marketing of three dimensional printing, rapid prototyping, and direct digital manufacturing systems primarily in North America, Europe, and the Asia Pacific. Market cap at $997.86M, most recent closing price at $46.87. Performance over the last quarter at 33.83%. The EPS estimate for the company's current year increased from 1.22 to 1.31 over the last 30 days, an increase of 7.38%. This increase came during a time when the stock price changed by -2.09% (from 47.87 to 46.87 over the last 30 days).

EPS data sourced from Yahoo Finance; all other data sourced from Finviz.

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

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